My 306 had a similar problem.  The issue, if I remember correctly, was
that it sometimes would not return to 0, instead almost doing a "max
speed this journey" reading.  Sometimes it would move backwards, and
sometimes it would return to 0 (in a juddering motion) when the ignition
was turned off.

I diagnosed it as a dodgy stepper motor (or whatever motor used for the
speedo dial) by swapping the rev counter motor and the speedo motor
(unsoldered and swapped them).  The rev counter one then did the same.
So I just removed that motor, blanked off the centre hole and just did
without the rev counter.  Peugeot wanted about £360 for a new instrument
cluster ("if they could still get it").

It was really easy to do, just a few screws to get the cluster out, and
about 5-10 mins with a soldering iron and maybe 30 mins to remove and
replace it - certainly less than an hour.  I doubt any garage would do
that solution, instead they'd just replace the entire cluster and charge
30+mins labour + parts.

D

Hi, It can also be a dodgey earth connection on the gear box.Check both main
earth cables.
Dave G

Among all the other solutions I've had similar problems on a Xantia with a
dodgy gearbox sensor. The garage fitted a preloved one for about £15.

Many thanks indeed for the suggestions re dodgey earth connections,
speedo motor, and gearbox sensor. Will get my son to investigate!